27 March 2013 16:59 [Source: ICIS news]
(recasts article clarifying the insolvency regards KEM ONE's upstream vinyls business KEM ONE SAS)
LONDON (ICIS)--France-based vinyls production business KEM ONE said it has placed its upstream vinyls business KEM ONE SAS into receivership on Wednesday.
Gary Klesch, chairman of owner company the Klesch Group, filed for insolvency “in view of the financial position” of KEM ONE SAS, the company’s upstream business.
The application to enter insolvency was approved on Wednesday by the Commercial Court of Lyon, which appointed an official receiver to take charge of the administration of the company. KEM ONE will continue to operate as normal during the proceedings, the company said.
News of the insolvency comes a few weeks after Klesch announced that it is seeking €310m ($397m) in compensation from former owner Arkema for “misrepresentations” in the sale of the business, acquired by Klesch Group and rebranded KEM ONE in July 2012.
KEM ONE SAS’ operations encompass the company’s upstream sites in France, with 1,300 people based across its Lyon headquarters and seven industrial sites across the country. The company’s downstream business – KEM ONE Innovative Vinyls – is performing satisfactorily, according to Klesch.
Klesch had requested the €310m to cover alleged financial shortfalls in KEM ONE’s balance sheet, and said at the time that it had not ruled out asking the arbitration court to annul the Arkema sale. Arkema has denied all claims of misconduct, stating that negotiations for the sale of its vinyl business to Klesch were fully transparent.
However, Arkema may take an active role in the company’s future, according to KEM ONE, which claims that the business is important enough to France’s chemical sector and the country’s economy in general to prompt private and public sector action to stabilise the company.
“Given the industrial, economic and social stakes for this petrochemical and chemical sector in France, the KEM ONE management team is confident in the commitment of its former shareholder Arkema... and its main supplier Total to find sustainable solutions for its activities, with the full support of the French government,” KEM ONE said in a statement.
KEM ONE is Europe’s third-largest producer of polyvinyl chloride (PVC).
($1 = €0.78)
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